Opportunities and challenges with Big Tech

After a period of explosive development during the raging COVID-19 pandemic, the “tech giants” (Big Tech) are trying to overcome difficulties arising from the gloomy situation of the global economy. The remarkable advances of artificial intelligence (AI) technology have also put Big Tech under heavy pressure to improve its competitiveness.
Opportunities and challenges with Big Tech

The wave of large-scale layoffs of a series of technology companies showed that these businesses are “tightening their belts” to get through this difficult period, as the global economic growth outlook continues to be quite fragile and potentially risky.

A recent report showed that in January 2023, layoffs in the US reached their highest level in more than two years as a series of technology companies cut jobs on a large scale. More than 102,940 jobs were cut in the US in January 2023, five times more than during the same period last year.

Looking at the depleted revenue of Big Tech, it is easy to understand why these businesses have had to cut thousands of jobs. Consumer demand for the technology industry dropped sharply after the pandemic, and persistently high inflation and rising interest rates have caused technology companies to struggle, bringing about an urgent need to save operating costs.

Specifically, Microsoft's revenue in the fourth quarter of 2022 reached 52.7 billion USD, equivalent to a 2% increase year-on-year and marking their lowest revenue growth since the second quarter of 2016. The reason is that companies, families and governments that used to buy computers during the COVID-19 epidemic are not providing the same level of demand.

Falling business isn't the only problem tech companies are facing. More and more countries are entering tight control over technology platforms. Google, Meta, Twitter, Apple are facing stricter regulations from the European Union (EU) on their online content.

Under the Digital Services Act (DSA), companies with more than 45 million users are considered very large online platforms and have more obligations such as risk management and independent auditing. These businesses must also share data with authorities and researchers, and apply a code of ethics.

Recently, The ChatGPT chatbot by OpenAI (based in the US) has created a boom in mass communication, confirming the development trend of AI. ChatGPT is considered to make users feel like they are talking to a real person with extensive knowledge on many different topics.

The “tech giants” such as Google, Meta ... have considered investing in AI, but the strong “coverage” of ChatGPT really makes it urgent for Big Tech to act.

In late January 2023, Microsoft confirmed it had invested billions of dollars in OpenAI, a move that could help Microsoft win market share from its main rival Google in the field of search engines. Google also announced the upcoming launch of Bard, Google's experimental conversational AI service, to compete with ChatGPT.

Although AI opens up new development opportunities for technology companies, it is not easy to control and ensure it provides users with AI technology products that are both useful, safe and reliable. United Nations High Commissioner for Human Rights Volker Turk warned that the developments of AI are posing great risks to human rights, so there is a need for mechanisms to protect against violations.

Over the past week, more than 60 countries have called for AI regulations to ensure that the technology does not harm international security and stability. There have been many criticisms related to AI products, such as privacy violations, fake news, academic fraud, and biased algorithms.

The competition for AI is heating up. Undeniably, this is a “fertile land” for technology companies, especially Big Tech, to promote their new development directions. However, experts said that coming up with a new business strategy needs to be cautious and responsible, to provide users with safe and high-quality technology products.